Gold prices rose on Tuesday as investors awaited key inflation data from the US. This data, due later this week, will provide clues on when the Federal Reserve might cut interest rates.
Spot gold was up 0.3% at $2,357.74 per ounce by 12:40 pm ET (1640 GMT). US gold futures rose 1% to $2,358.50, Reuters reported.
The dollar slipped 0.2% to a more than one-week low, making gold less expensive for other currency holders.
This week, the focus will be on the US core personal consumption expenditures price index (PCE), the Fed’s preferred inflation gauge due on Friday.
Recent Fed meeting minutes suggest holding rates steady for now. However, traders believe there’s a 63% chance of a rate cut by November. Lower rates make holding gold, which doesn’t offer interest, more attractive.
Global central banks have been increasing their gold demand for two years as they diversify their foreign currency reserves.
Meanwhile, global physically-backed gold exchange-traded funds (ETFs) saw net outflows of 11.3 metric tons last week, according to the World Gold Council.
